Knickerbocker Ice Co. v. Gardiner Dairy Co.

⁵⁵⁸ Boyd, C. J., delivered the opinion of the Court. This is an appeal from a judgment rendered against the appellant in favor of the appellee for causing the Sumwalt Ice and Coal Company to break a contract between it and the appell^R by which the former had agreed to furnish the latter with icH As the first question to be considered is a demurrer to the Hclaration, which was overruled, we will state the material aHgations made in it. It is alleged that the plaintiff was enHged in the dairy business in June, 1906, and required a large ^antity of ice, during the spring and summer months; that, inlHer to meet its requirements, it entered into a contract wldHthe Sumwalt Company, whereby that company contracJecSk^ deliver to the plaintiff, and the plaintiff agreed to buyffronu-it^ an amount not exceeding twenty tons of ice each day frojgi/the date of the contract until the completion of the plainnSys plant then in course of construction, at the price of $5 per ton, delivered; that, at the time, the Sumwalt Company was purchasing ice in large quantities from the defendant, which was engaged in the manufacture of ice; that the defendant,1 learning of the contract between the plaintiff and the Sumwalt Company, notified the latter that it would refuse to deliver any ice whatever to it, unless it refrained from delivering ice to the plaintiff; that said Sumwalt Company being compelled by the exigencies of its business to secure ice from the defendant, and being alarmed by ° the threat of the defendant, broke its said contract with the plaintiff and advised it that, because of the action of the defendant, it could not carry out its contract with the plaintiff; that thereby the plaintiff was compelléd to purchase ice directly from the defendant at a price considerably greater, and on terms considerably less advantageous to it, than it was enjoying under its contract with the Sumwalt Company. It is further alleged that the action of the defendant in causing the Sumwalt Company to break its contract with the plaintiff “was with the desire and intention on the part of the defendant of injuring the plaintiff and of obtaining a benefit for itself, that said action was deliberate and malicious, and ⁵⁵⁹ inspired by the wish and purpose to force the plaintiff to buy ice directly from the defendant at a larger price, in larger quantities and for a longer period, than were required of the plaintiff under the terms of its aforesaid contract with the Sumwalt Ice and Coal Company.

By which unlawful and malicious action on the part of the defendant the plaintiff has been greatly damaged.” There is a great conflict between Judges and law-writers as to how far there is a remedy for interference with contract relations, and it would be a useless task to undertake to reconcile ''them. They quite generally agree in their conclusions when the relation of master and servant exists, but even then reach the same point by different routes. Lumley v. Gye, 2 E. & B. 216, is the leading case on the subject. Prior to the dissenting opinion delivered by Justice Coleridge in that case, it seems to have been assumed that the action for enticing servants was a common law action, but in that opinion he asserted, and with his marked ability undertook to establish, • that such was not the case and that it was founded on the Statute of Laborers, 23 Edw. 3 , and that both on principle and authority was limited by it.

But however that may be, that statute was never in force in this State and could not have been applicable to conditions here, and the right to such action has always been regarded as a part of the common law. Justice Coleridge also undertook to show that the general rule of the English law in respect to breaches of contracts was to confine its remedies by action to the contracting parties, but while it may be conceded that, as a rule,- such actions had been -confined to those parties, it does not follow that the right of action in third parties did not exist. In Lumley v. Gye, there was a demurrer to each of the three counts in the declaration, and it was held by Judges Wightman, Erle and Crompton, quoting from the syllabus, that “the counts were all good, and that an action lies for maliciously procuring a breach of contract to give exclusive personal services for a time certain, equally whether the employment has commenced or is only in fieri, provided the procurement be during the ⁵⁶⁰ subsistence of the contract, and produces damage; and that, to sustain such an action, it is not necessary that the employer and employed should stand in the strict relation of master and servant. Semble, by the same Judges, that the action will lie for the malicious procurement of the breach of any contract, though not for personal services, if by the procurement damage was intended to result and did result to the plaintiff.” In Ensor v. Bolgiano, 67 Md. 190 , Mr. Ensor, an attorney, sued the defendant, alleging that, with malice towards the plaintiff, he induced one Allen to compromise his case against a turnpike company in which the defendant had stock, and to break his contract with the plaintiff to pay him a contingent fee.

This Court disposed of the case on the ground that there was no legally sufficient evidence to support the action, and declined to express any opinion on the law as laid down in Lumley v. Gye — although Judges Yellott and Bryan filed dissenting opinions in which they approved of the doctrine announced in that case. In Lucke's case, 77 Md. 396 , it was held that where an employee, who was performing the duties of his position to the entire satisfaction of his employers, was discharged in consequence of a threat from a labor organization that if he was longer retained, it would be compelled to notify all labor organizations of the city that the business house of the employers was a non-union one, and thus subject them to a great loss, such interference was wrongful and an action would lie against the labor organization by the employee, for the damage he sustained in consequence of such discharge. The evidence showed that the employee was to continue in the employ of his employers as long as his work was satisfactory, but they reserved the right to discharge him at the end of any week. A member of the firm testified that they would not have discharged him except for the objections by the appellee.

This Court quoted with approval from Benton v. Pratt, 2 Wendell, 385 , that “Where a contract would have been fulfilled but for the false and fraudulent representations of a third person, an action will lie against such person, although the con ⁵⁶¹ tract could not have been enforced by action.” It also quoted at length from Chipley v. Atkinson, 23 Fla. 206 , which said neither the fact that the term of service interrupted was not for a fixed period, ntfr that there' was a right of action against the person induced or influenced to terminate the service, or to refuse to perform his agreement, was of itself “a bar to an action against the third person maliciously and wantonly procuring the termination of, or a refusal to perform, the agreement. It is the legal right of the party to such agreement to terminate or refuse to • perform it, and in doing so he violates no right of the other party to it; but so long as the former is willing and ready to perform it, it is not the legal right, but is a wrong on the part of a third party maliciously and wantonly to procure the former to terminate or refuse to perform it.” The Court also quoted from Bowen v. Hall, L. R. 6 Q. B. D. 338, which we will refer to later. It said that the Lucke case and that of Lumley v. Gye, “widely differ in important facts, and there is but small analogy in the principles of law properly applicable in each case,” but it will be observed that it announced principles which are analogous to those sought to be applied in this case. It distinctly held that an action by an employee would lie against a third person, who maliciously and wantonly procured the termination of the arrangement between the employer and employee, which was not for a definite period, and the facts show that Lucke was not a mere menial servant but a skilled “first class customs cutter.” Some material distinctions between that case and the one before us are apparent, but it does go one step further than the cases usually foundrin the books, in which the relation of master and servant or employer and employee is in any way involved, and there was not, as here, a binding contract between the parties.

Generally speaking such suits have been by the master for the enticement of his servant, while the Lucke case was by an employee against a third person for causing his discharge by the employer, and it is difficult to see why, upon principle, a party to a contract should be con ⁵⁶² fined to an action against the other party for a breach of it, when a third party has been the deliberate cause of the breach, for his own selfish or malicious purposes. To say that he has his remedy against the other contracting party is in many cases offering a mere shadow for substance, for oftentimes he may have his trouble for his pay, as the other party to the contract may be financially irresponsible. Why should a labor organization, which has the right to organize and act for the protection and benefit of its members, so long as it does not infringe upon the rights of others, be responsible for causing the discharge of one who it believes interferes with the interests of its members by being so employed, while an employer of labor can maliciously and wantonly, or for his own selfish purposes, cripple another employer with impunity? If the Clothing Cutters and Trimmers Assembly was liable for causing the New York Clothing House to discharge Lucke why should not some importer, or -wholesale dealer, have been liable to that house if he had procured some other importer, or dealer, with whom it had a contract, and upon whom it was dependent to secure such goods, to break his contract with that house, and thereby force it to deal on disadvantageous terms with the procurer?

Such distinction, based on the technical ground that the relation of master and servant exists in'the one case and not in the other, would be well calculated to impress laborers with the belief that the law discriminates between labor and capital — making the one responsible but not the other. Trusts and combinations of capital have ruined many while hiding behind means apparently lawful, but if they cannot be reached when it is shown that they have maliciously and wantonly, or for their own selfish purposes, not only prevented others from making contracts, butjcompelled contractors to break their contracts, then indeed is the law helpless. Yet that is just what the theory of the appellant, if adopted, might lead to, and it should not be adopted unless clearly within well established principles of law. And when we are called upon to determine that question, we are not to be governed entirely by the lack or scar ⁵⁶³ city of precedents furnishing a remedy.

Principles of law ought not to be stretched beyond reason and justice, but they ought not unnecessarily to be so contracted as to allow them' to be made use of as instruments of oppression. This Court quoted in Lucke’s case from Winsmore v. Green bank, Willes Rep. 581, where it was said, “special action on the case was introduced for the reason that the law will never suffer an injury and a damage without a remedy.” In Bottomly v. Bottomly, 80 Md. 162 , Judge Bryan stated that; “where it is^said that when the plaintiff has a right he must have a remedy, if he is injured in the enjoyment of it; "it must necessarily be understood that the injury must be an act which is unlawful in itself, or that it is rendered unlawful by the circumstances under which it is committed.” And in speaking of Lucke’s case he said, “We held that the conduct of the defendant was malicious and unlawful, and that it gave the plaintiff a good cause of action. It was a scheme to accomplish an unlawful result by unlawful means.” So in Gore v. Condon, 87 Md. 368 , after stating the facts fully, Judge Briscoe, in delivering the opinion of the Court, said: “The question then is, whether the conduct of the defendant under the circumstances stated in this case constituted such a wrongful act, as will give rise to an action for damages.” In that case the plaintiff was the owner of some houses and lots, and the defendant obtained a mortgage thereon from a person he knew was not the owner, and although knowing that the mortgage was fraudulent and void, caused the tenants of the property to cease paying their rents to the plaintiff, and advertised the property for sale under an' ex parte decree of foreclosure on the mortgage, which was afterwards vacated by a Court of equity. The tenants. moved away and the plaintiff lost the rents.

It was held that “if a man knows that certain property is not his but another’s, and that his apparent title to the same was acquired by fraud and is void, then his intermeddling with such property to the damage of the real owner is an unlawful act for ⁵⁶⁴ which an action lies.” It was also said, “The right to maintain the action can also be sustained, upon the doctrine that a man who induces one of two parties to a contract to break it, intending thereby to injure the other or to obtain a benefit for himself, does the other an actionable wrong” — citing Lucke's case, Angle v. Chicago &c. Ry., 151 U. S. 14 , Lumley v. Gye, Bowen v. Hall, supra, and Walker v. Cronin, 107 Mass. 555 . It cannot be denied that it is unlawful for a party to a contract to break it, unless, of course, he has sufficient ground for doing so, and therefore when a third party procures or induces him to do so, he is causing him to do an unlawful act, which is itself unlawful, and the law ought to afford a remedy to the injured party. In the appendix to 87 Md. there is a note on Gore v. Condon , by Mr. Brandy, which considered at length the subject of interference with contracts, etc., with his usual clearness.

Some of the questions discussed in that note are not involved in this case — for example, the distinction made by some authorities between preventing a contract being made and causing one already made to be broken. This declaration distinctly alleges that a contract had been made, and that the defendant caused the Sum wait Company to break it, and there is testimony tending to sustain those allegations. In Lucke’s case it was held that the defendant was liable although there was no contract in force, requiring the employers to continue his employment, but that part of the decision relied on the discharge, connected with the fact that he would have been continued but for the threats and action of the defendant. In addition to the authorities cited in Gore v. Condon, supra, there are many others in which it has been held that procuring a breach of an existing contract is actionable.

In Perkins v. Pendleton, 90 Me. 166 (S. C. 38A. 96), the Court cited with approval Lumley v. Gye, and Bowen v. Hall. After quoting at length from the latter it said: “The doctrine of these cases has been very generally adopted, and the cases themselves very frequently cited, by the Courts of this country,” citing a number of them, and added, “In view of these ⁵⁶⁵ authorities and others, which it is not necessary to refer to, it must be conceded that for a person to wrongfully — that is, by the employment of unlawful or improper means — induce a third party to break a contract with the plaintiff, whereby injury will naturally and probably, and does in fact, ensue to the plaintiff, is actionable; and the rule applies both upon principle and authority as well as to cases where the employer breaks his contract as where it is broken by the employee; in fact it is not confined to contracts of employment.” The Court cited Walker v. Cronin, Chipley v. Atkinson, Lucke's case, Raycroft v. Tayntor, 68 Vt. 219 , and others. See also Jones v. Stanley, 76 N. C. 355 . The English cases have for the most part sustained Lumley v. Gye.

In Bowen v. Hall, supra, Judge Brett and Lord Chancellor Selborne delivered opinions’affirming Lumley v. Gye, Lord Coleridge, C. J., dissenting. Judge Brett said that the decision of the majority in that case held that, “wherever a man does an act which in law and in fact is a wrongful act, and such an act as may, as a natural and probable consequence of it, produce injury to another, and which in the particular case does produce such an injury, an action on the case will lie.” And again he said: “Merely to persuade a person to break his contract may not be wrongful in law or fact, as in the second case put by Coleridge, J. But if the persuasion be used for the indirect purpose of injuring the plaintiff, or of benefiting the defendant at the expense of the plaintiff, it is a malicious act which is in law and in fact a wrong act, and therefore a wrongful act, and therefore an actionable act if injury ensues from it. We think that it cannot be doubted that a malicious act, such as is above described, is a wrongful act in law and in fact.” In Allan v. Flood (1898) A. C. 1, a conclusion was reached which is not in accord with Lucke’s case, but Lumley v. Gye, was not overruled, although commented on in the opinions filed. In Quinn v. Leathem [1901], A. C. 495, Lord Macnaghten, in referring to Lumley v. Gye, said, “Speaking for myself, I have no hesitation in saying that I